This article is merely for informational purposes and does not constitute legal advice. The author highly recommends that anyone seeking to sell a horse to satisfy unpaid bills seek the advice of an equine attorney licensed to practice in their state. Boarding and training clients who don’t pay their bills are an expensive and pervasive problem. Even high-end equestrian facilities are increasingly affected by the economic downturn, leaving many stables and trainers wondering what to do.

Aren’t There Lien Laws to Protect Stables and Trainers?
As many Northwest equestrian facilities are aware, Oregon, Washington and Idaho state laws each provide boarding and training facilities with a lien on horses in their care for unpaid bills. So, a stable or trainer can sell the client’s horses to pay the client’s bill – right? Well…maybe. Here’s the catch (and it’s a big one). In order to lawfully sell a non-paying client’s horses, the stable or trainer has to follow exactly each step of its state lien law filing, notice and foreclosure procedure, which is typically complicated and time-consuming. As unfair as this sounds, if the lien law isn’t followed to the letter, the stable or trainer could face a civil lawsuit, and, in Washington, even have to pay the client’s attorney’s fees (as well as their own!).

Properly foreclosing on a lien and selling the client’s horses will likely take at least 60 to 90 days, often much longer. Some state lien laws require the stable or trainer to retain possession of the horses during the lien foreclosure process. During that entire time, the stable or trainer will have to feed and care for the horses at their own expense, and they may not ever recoup those expenses. On top of that, the stable or trainer will probably have to hire an attorney to assist them, especially if their state’s process involves obtaining a court order. Unless the state lien law specifically provides for recovery of attorney’s fees or the boarding or training contract includes an attorney’s fees clause, the stable or trainer has little chance of recovering what they will spend to hire a lawyer.

Even if the stable or trainer successfully navigates the lien foreclosure process, the horses a non-paying client leaves behind seldom have much market value. If the horses do happen to be worth something, their market value will be compromised by the situation. If the horse is registered, its papers will be hard, if not impossible, to obtain. If the lien law requires the horse to be sold at public auction, it will almost certainly bring a lower price than in a private sale. Even if a private sale is legally permissible, prospective buyers will be wary of possible complications from the horse’s former owner.

Priority One: Get the Client to Leave
When faced with a non-paying client, the best outcome is to have the client leave as soon as possible, and take their horses with them. Why? The horses continue to eat and use bedding, and they occupy stalls that could otherwise house paying customers’ horses. Even though the client isn’t paying, the stable or trainer still has all the same responsibility to provide adequate care and a safe environment for the horses and could be legally liable if it doesn’t do so. So, an empty stall is better than a stall occupied by a horse not paying its way. Meanwhile, the client may be disgruntled and unpleasant to be around, driving away paying clients. With the client and their horses gone, the meter stops running on the feed bill and the facility’s responsibilities.

Meanwhile, let’s not forget about quality of life! Foreclosing on a lien is a lengthy, expensive and time-consuming process that typically causes a lot of stress for the stable or trainer. The client often appears at the eleventh hour wanting to negotiate a deal or trying to stop the foreclosure process, and they always seem to show up in the middle of the night. If the stable or trainer refuses to allow the client to take the horses, the client will usually call the sheriff. Typically, the sheriff will arrive, hear the other side of the story and tell the parties that the situation is a civil matter and therefore law enforcement won’t get involved. However, such situations frequently turn into a scene before that happens, with shouting, threats and worse. All in all, it’s best to have the client and the horses go – as soon as possible.

After the Horses are Gone: Collection
If the stable or trainer allows the client’s horses to leave the property, it limits the total bill, making it more likely that the claim can be brought in small claims court. The small claims limit is currently $5,000 in Washington and Idaho, and $7,500 in Oregon and California. And, the stable or trainer can usually convince the non-paying client to make at least some cash payment when they take the horses, reducing the amount of money they have to collect. If, when the client arrives to take the horses, the stable or trainer can convince the client to sign a written statement that they do owe the amount in question, it will make pursuing a claim for money damages even easier. In small claims, the stable or trainer can represent themselves and avoid the expense of hiring an attorney. And, contrary to popular opinion, small claims judgments can be enforced. If the client doesn’t pay the judgment, the stable or trainer has remedies, including garnishing the client’s wages and/or bank account and putting a lien on their house. A claim reduced to a court judgment is far easier to enforce than a stableman’s lien, and in most instances, judgments earn interest until they are paid, and the stable or trainer can usually recoup the cost of enforcing a judgment, including attorney’s fees.

About the Author: Rachel Kosmal McCart is the founder and principal attorney of Equine Legal Solutions, Inc., an equine law firm based in the Portland, Oregon metro area. Rachel is licensed to practice in Oregon, Washington, New York and California, and also associates with attorneys in other states on equine law matters. ELS offers free telephone consultations on any equine legal matter. More information is available on ELS’ website at www.equinelegalsolutions.com or by calling 866-385-2972.